RIAA Loses Bid To Keep Revenues Secret 229
Posted
by
timothy
from the but-your-honor-that's-our-secret-recipe-for-money-soup dept.
from the but-your-honor-that's-our-secret-recipe-for-money-soup dept.
NewYorkCountryLawyer writes "The RIAA's motion to keep secret the record companies' 1999-to-date revenues for the copyrighted song files at the heart of the case has been denied, in the Boston case scheduled for trial July 27th, SONY BMG Music Entertainment v. Tenenbaum. The Judge had previously ordered the plaintiff record companies to produce a summary of the 1999-to-date revenues for the recordings, broken down into physical and digital sales. On the day the summary was due to be produced, instead of producing it, they produced a 'protective order motion' asking the Judge to rule that the information would have to be kept secret. The Judge rejected that motion: 'the Court does not comprehend how disclosure would impair the Plaintiffs' competitive business prospects when three of the four biggest record labels in the world — Warner Bros. Records, Sony BMG Music Entertainment, and UMG Recording, Inc. — are participating jointly in this lawsuit and, presumably, would have joint access to this information.'"
Come on Ray! (Score:1, Interesting)
Anyone down for taking bets?
Show us the money! (Score:5, Interesting)
Re:Come on Ray! (Score:3, Interesting)
It sounds like they haven't produced the numbers, only a motion saying they shouldn't have to produce the numbers.
In other words... (Score:2, Interesting)
Is this Legit, or Contempt? (Score:5, Interesting)
Ray--if I was ordered by a judge to produce a detailed breakdown of my accounting (say a trial for tax evasion) practices over the past years by 7/31, and on the 31st I came to court with just a "protective order motion" asking that my accounting practices be kept secret...
Wouldn't I be held in contempt?
I mean...I can see producing the motion *with* the information...or...before it...but... tell me why it is these guys appear to have rights in the legal system that everyone else doesn't... More importantly, what piece of paperwork do I have to file so I can ignore court orders like they do and get off scott free?
What are these other documents? (Score:5, Interesting)
Gertner's ruling states that "[the Court] will, however, order the second set of documents, which implicate the business interests of third-party artist-owned companies, shielded from disclosure."
What are these documents, and who are these "third-party artist-owned companies?"
There, RIAA shit. (Score:5, Interesting)
the judge has corrected a MAJOR malfunction in your logic circuits. next time when you accuse someone of damaging your profits, you will remember to actually prove EVIDENCE to back up your case. that is, unless your leashholders are afraid of being proven wrong about all the shit you have been perpetrating. enjoy.
Forcing them to show their hands (Score:5, Interesting)
This could be the beginnings of an interesting new strategy against the RIAA. Forcing the RIAA to produce the verifiable truth about various things and to pull their skeletons from their closets and put them on display can likely act as quite a deterrent against RIAA actions.
Still. How is the judge taking their failure to produce the data? Does making a motion instead of producing the data result in an automatic extension somehow? Is this an unwritten part of due process now?
Re:In other words... (Score:3, Interesting)
While decreasing CD sales are being caused by increasing digital sales, overall cash is going down. But that's not anybody's fault. People don't want to buy the CD because it's overpriced and they only want the one or two good songs that are hyped on the radio. Why buy the rest of the trash?
Then add in Wal Mart is running independent music stores out of business and then turning around and only offering a fraction of the selection - the majority of it being the latest hype crap that everyone wants to buy single downloads for. :)
In the end, they have to understand that this is the way of the world and they will have to get use to living on a smaller budget. Something they desperately want to avoid.
Re:Come on Ray! (Score:4, Interesting)
What I'm wondering at this point is do they have to release this information publicly, or only to those participating in the case, or ? Betting next thing we see is for them to try to limit as much as possible who has access to this evidence.
Re:Come on Ray! (Score:5, Interesting)
I'm putting my money on "case is dropped, RIAA gets to keep things secret"
Re:cracks in the dam (Score:2, Interesting)
Re:I wonder if ... (Score:5, Interesting)
I wonder if they told the artists one set of numbers and need more time to make sure what they give to the court matches that set.
Herein lies the issue. If they go with the artist numbers, then revenues might be small. Punitive and compensatory damages will likely be small as a result. However, if they want to claim higher numbers, then the artists will turn around and sue them for the stolen revenue. They're caught between a rock and a hard place, and that's good...
Re:Is this Legit, or Contempt? (Score:5, Interesting)
Ray--if I was ordered by a judge to produce a detailed breakdown of my accounting (say a trial for tax evasion) practices over the past years by 7/31, and on the 31st I came to court with just a "protective order motion" asking that my accounting practices be kept secret... Wouldn't I be held in contempt? I mean...I can see producing the motion *with* the information...or...before it...but... tell me why it is these guys appear to have rights in the legal system that everyone else doesn't... More importantly, what piece of paperwork do I have to file so I can ignore court orders like they do and get off scott free?
If I were the Judge I probably wouldn't have held them in contempt, but I probably would have issued a discovery sanction. Since in this case the material is needed to assess the fair use defense, which would be a complete bar to the action, I would have issued an order striking their complaint, dismissing the case.
Re:Come on Ray! (Score:5, Interesting)
I'm putting my money on "case is dropped, RIAA gets to keep things secret"
That's an interesting thought. Hard for me to imagine them doing that, though.
Re:Is this Legit, or Contempt? (Score:4, Interesting)
The way most things work in court is that your response is due based on the order from the judge. If you are ordered to provide tax information by 7/31, you have a number of options. Only one of them is actually providing that information. You can also respond by challenging the order, requesting a limitation on the order, showing cause why you can't comply with the order, and depending on the situation, other options.
The deadline is the due date for the responsive filing. As long as the response isn't completely devoid of rationality or some support, the court will review the response and then either adjust the original order or respond by saying, "nice try, but now do what I said". It's not contempt to push back in civil litigation unless you're doing it solely for the sake of wasting time or money.
In this case, because a protective order was issued, it obviously wasn't devoid of a real issue.
Now, sometimes, an order is an order and the only permitted responses are (a) compliance or (b) a request for more time to comply (which may or may not be granted, especially if dropped on the court at the last minute). This is rarely the case.
Moreover, the summary is again biased and sensationalized, part of a pattern that shows increasingly unprofessional conduct on the part of the submitter. The RIAA offered a proposed order that was greater in scope than what they had argued for. Had the judge and her clerks read only the moving papers and then just signed the order, the RIAA would have had that order amended upon discovery of the inconsistency. The RIAA actually got the protective order it had argued for--it just didn't get the overbroad proposal they submitted.
You could automatically bounce back to "the RIAA is evil and incompetent", which no one would disagree with, but there's almost no chance that this would have ever worked--it's not like the judge is powerless upon discovery of the problem, which is almost inevitable unless opposing counsel is beyond incompetent, and attempting to slip an expanded order in intentionally opens them up to all kinds of sanctions. The thing is, you rarely get more than what you ask in a proposed order attached to a motion--so it's not uncommon to "shoot for the moon" and then the court writes a narrower order based on how much it's willing to give you. In most cases, it's not a plot. It's just the way the game is played.
Re:Is this Legit, or Contempt? (Score:1, Interesting)
How would a more robust protective order have acted as a complete bar to asserting fair use? (Full disclosure: I haven't read the proposed protective order that the judge decided not to adopt) They defendant's attorney, expert witnesses, judge, jury etc. should have still been able to use the information. Some of the hearings might have been closed and some of the documents filed under seal, but those are issues that affect the general public, not the parties in the trial.
Asking the judge to protect a small subset of information by asking her to sign off on a blank cheque to protect anything is unscrupulous, but dismissing the case as punishment very well could be considered an abuse of discretion.
Re:Finally we will get the truth... maybe... (Score:4, Interesting)
Early 2000 I did a bit of research on the topic and found somewhere a document [...] that showed the RIAA's claim of loss of income to be fewer records released, not because people were downloading music for free
Is this [azoz.com] what you're referring to?
Re:But Sir (Score:3, Interesting)
Infringement isn't about sharing a complete copy. If you shared half a song with two people, that could be interpreted (and would be, I expect) of two infringements.
Taken to an (absurd IMO) extreme, that could be taken to mean that if you shared 1/N of a song with N people, that would be N infringements ... meaning one could easily "infringe" several hundred thousand times while uploading to someone over p2p. This seems absolutely absurd to us, but until someone answers "what fraction of a copyrighted work is no longer considered infringement", that could very well BE the court interpretation as well. Currently, it seems (to a lay person like myself) that the courts consider ANY fraction of a work to be infringing.
Not being a lawyer, the only reference I have on this is the copyright.gov listing of the copyright code, which seems pretty vague.
Re:I wonder if ... (Score:5, Interesting)
Herein lies the issue. If they go with the artist numbers, then revenues might be small. Punitive and compensatory damages will likely be small as a result. However, if they want to claim higher numbers, then the artists will turn around and sue them for the stolen revenue. They're caught between a rock and a hard place, and that's good...
You could expand that as well. If there is a *cough* significant difference between the two numbers, the disclosure could open the RIAA companies to accusations of conspiracy to defraud on a grand scale. Passing the hot potato between holding companies until fees eat up the value that would otherwise be distributed as profit is an old trick. A very old trick, and one that wouldn't be treated sympathetically by a court that enforced visibility of the transactions as a group. The term, I think, is "forensic accounting" and firms like KPMG (disclosure: once was employee, long ago) have practice groups that are used by prosecutors for just this purpose.
I don't think it would be the first time that the discovery part of a lawsuit triggered new proceedings. Sort of like "Well, I was just on my way to a burglary when the guy ran into me..."
Taxes too (Score:4, Interesting)
It's not just the royalties/payments to the artists, it's the taxes, which could become an even bigger issue.
While big corps might be able to get away with shady practises to hide their real profits, if they try to stick with a large penalty by announcing revenues of several times what was declared on their taxes they're likely going to be in deep trouble
Not only that, but showing huge profits is going to blow away their pleas of "piracy is killing the industry and we're losing money/profits/etc", which is probably the real point here....
Re:Not only that ... (Score:3, Interesting)
Would be interesting to compare said numbers to, say, what Reznor has been making from his "download the album for $5" thing.
I know he said he got more from it that he did from most of his albums, but would be good to have hard numbers :)
Re:Is this Legit, or Contempt? (Score:4, Interesting)
Ray, correct me if I'm wrong, but I don't think cases are normally dismissed as a result of discovery sanctions for a single missing document.
If you're 2 weeks away from the trial, and one side deliberately flaunts an order directing them to produce something which is key to a total defense; you bet it is.
Re:Is this Legit, or Contempt? (Score:4, Interesting)
I would have issued an order striking their complaint, dismissing the case.
But then, we wouldn't see the records, right? Maybe the judge is as curious as you and I regarding what they're trying to hide?
Taxes (Score:1, Interesting)
When they end up having to produce their profits, we'll be able to see the proportion of money they make from lawsuits on consumers versus actual sales. Also, maybe the IRS can see where they've falsified their tax reporting. In addition, we'll be able to see how little they've actually paid their artists, and how they've given none of their revenues from lawsuits to the artists.
Re:Come on Ray! (Score:1, Interesting)
This is a tough call.
On the one hand, if they do proceed and provide details as requested, they could be opening themselves up to a whole new host of problems that they're eager to avoid.
On the other hand, if they withdrew the case, in my mind it would seem to create a vulnerability that other cases could exploit.
My bet is on them providing the data but for that data to be "cooked". If I was the defendant(?), I think I would be asking for an independent auditor (someone said KPMG?) to come in, look at the numbers, and provide a summary, as these guys have quite clearly shown they can't be trusted.